Siobhan Cooper, 27, isn’t paid for her master’s degree in public health and she rarely uses her education experience at her full-time serving job at The Blacksmith Restaurant in Bend.

She works for minimum wage, plus tips, without health insurance. In between waiting tables, she’s pursuing more academia – organic chemistry classes at Central Oregon Community College – and tries to save, which is hard for someone who’s held minimum-wage jobs for the past 1 1/2 years.

Effective today, the Bend resident will make 25 cents more per hour, as Oregon’s minimum wage increases from $7.25 per hour to $7.50, based on cost-of-living increases. That gives a full-time worker an additional $520 per year, an added cost to business owners who employ minimum-wage workers.

”I don’t see any positive,” Cooper’s boss and Blacksmith co-owner Burk Daggett said of the wage increase. ”It’s a feel-good measure by the Legislature that clearly doesn’t understand the needs of the business community.”

Some opponents, like Daggett, say the high minimum wage dangerously increases operating costs, hurting local businesses.

Supporters argue that the increase helps the economy by giving employees more purchasing power and enticing more workers to the area.

Oregon has the second-highest minimum wage in the country behind Washington state at $7.63 per hour.

The federal minimum wage remains $5.15 per hour and has not increased since 1997.

Oregon’s 3.4-percent increase is a small change, Cooper said, but one for which many service workers are thankful.

”I will make about $12 more per paycheck,” Cooper said. ”It’s not really that much when you get down to it. But on a certain level, I don’t think I work a minimum-wage job because I get so much more in tips.”

Cooper is lucky because most Blacksmith customers are generous tippers, but her income still isn’t enough to pay her bills, forcing her to work an extra 50 hours per month at the Rock Springs Guest Ranch to help pay rent. If she cannot work enough hours at the ranch to pay rent, she makes up the difference out of her own pocket. Cooper’s parents help her pay tuition, but that’s all the assistance she gets.

Cooper is one of 4,342 Central Oregon employees who work minimum-wage jobs, according to Jan Swander, workforce analyst for the Oregon Employment Department. That comprises 6 percent of the Central Oregon working population, based on first-quarter 2005 data, the latest available.

Central Oregon has more minimum-wage workers than the state average – 5.8 percent of Oregon workers make minimum wage – because Central Oregon has a larger mix of industries that pay minimum wage, Swander said.

Most minimum-wage employees are in retail, leisure, hospitality and food services, she added. In leisure and hospitality, 43.5 percent of jobs pay minimum wage in Central Oregon, compared to statewide rates of 20.5 percent. In retail and trade, 21.7 percent of workers earn minimum wage, compared to the state’s 9.3 percent.

The wage increase is the result of Ballot Measure 25, which Oregon voters passed in November 2002, and requires annual adjustments to the minimum wage based on rises in the Consumer Price Index, or CPI.

The CPI is based on average increases in housing, gas and food costs from 150 cities nationwide. If inflation rises nationally, so does Oregon’s minimum wage.

That does not mean the minimum wage is a living wage, said Dan Gardner, commissioner of the Portland-based Bureau of Labor and Industries. Gardner was one of the chief petitioners of Ballot Measure 25.

Someone living solely on a minimum-wage income is in poverty, he said.

”Unfortunately, we have more minimum-wage jobs than we used to, especially as we’ve seen manufacturing leave the state and country,” Gardner said. ”It’s not a good trend, but it is a trend in this country.”

Oregon’s ”living wage” for a single adult – based on basic costs like housing, groceries, health care, child care, transportation and savings – is $10.77 per hour, or $22,404 per year, according to the 2005 Northwest Job Gap Study by the Northwest Federation of Community Organizations, a community action network. That is $6,804 more than a full-time minimum-wage worker would make in one year.

The federal poverty level is $9,570 per year for a one-person family, according to the U.S. Department of Health and Human Resources.

Gardner said minimum wages are not meant to be living wages.

”With minimum-wage increases, we get closer to it being a living wage,” he said. ”But it’s just intended to set a bare minimum that an employer could pay. I don’t think the minimum wage will ever be a living wage.”

Cities can pass their own living wage ordinances, Gardner said, which are higher than the state and federal minimums. These rates can be enacted by city council ordinances or by ballot initiatives for both public and private employees, he added.

In 2002, Santa Fe, N.M. passed a living-wage law that required privately owned businesses to pay workers $8.50 per hour, eventually increasing to $10.50 by 2007.

Good for workers

Gardner said the minimum-wage increase will affect Central Oregon in the same ways it affects other areas: when minimum-wage workers get a pay increase, they spend that money in the local economy.

Michael Funke, long a fighter for workers’ rights, agrees. He is the organizer for Jobs With Justice, the Central Oregon leg of a national labor community action coalition that works for workers’ rights, economic justice and the right to organize.

”Minimum-wage workers are people making low wages to begin with,” Funke said. ”We’re not talking about people taking the wage increase and investing in stocks and bonds. That money goes right back into the local economy. And the economy benefits from the increased purchasing power of these workers.”

Some restaurant employers, who have to increase pay, support the wage. Pilot Butte Drive-In Restaurant co-owner Jack Mangin supports the increase because employees deserve it, he said, adding that the increases are not life-threatening to businesses.

He said his employees receive more than minimum wage because they do not work for tips, and he is increasing their wages further since the minimum-wage hike.

”(The wage increase) is not a great thing for employers, but if you pay minimum wage in this day and age with no tips, that is a very poor wage,” Mangin said. ”I don’t think anybody could justify paying that.”

The cost to employers

The employment department’s Swander said she hasn’t heard many complaints from employers this year about the minimum wage. But past increases have elicited grumbles, primarily from small-restaurant owners like the ones that dot downtown Bend.

Those employers usually adjust to the cost increases by increasing productivity through existing labor and other resources, passing the expense to customers by increasing prices for meals or services, or accepting a lower profit, she said.

Blacksmith owner Daggett says he’ll absorb the cost as long as he can.

The wage increase has noble intentions, but it hurts restaurant owners’ bottom line and prevents them from hiring more employees, he said.

Servers make considerably more than minimum wage with tips, so the wage increase only puts more strain on the employer, he said.

”The difficulty for the restaurant owner is that servers are among the highest-paid employees because of tips,” Daggett said. ”But we’re still required to pay them minimum wage when a tip wage would be less strenuous on us.”

A tip wage is comprised of tips and the state minimum, so a server could receive less pay per hour from an employer, with the assumption that tips would bring the wage to or beyond minimum. In most states, if a server’s wages and tips do not earn them minimum-wage pay, employers are required to make up the difference.

If Oregon’s minimum wage were lower, Daggett added, it would allow employers to pay more competitive wages to attract and retain the most qualified employees.

”If our minimum wage were $5 (per hour) and businesses only paid that, they would get crappy employees, forcing them to pay better to get better (employees),” Daggett said. ”The market would determine what you have.”

Oregon Restaurant Association (ORA) representatives echo Daggett’s complaints.

The Oregon Restaurant Association believes that minimum wages that are higher than the federal minimum wage, so-called ”super minimum wages,” are destructive, said regional representative JoDee Phillips. The reasons go beyond the costs they add to small and local hospitality and restaurant businesses that already operate on a thin profit margin, she said.

Phillips said Oregon and Washington are two of seven states that do not have a tip wage.

”The ORA continues to introduce legislation to remove the (minimum-wage increases) and to allow future increases to be offset by a tip income,” she said, adding that it would help employers and employees in the hospitality industry.

Cooper has heard many people say that tips make up for low server pay, but she’s not persuaded. At her previous restaurant job in Sisters, some customers tipped less because they said Oregon’s minimum wage was too high.

”People think we get enough anyway,” Cooper said. ”And that’s ridiculous. I don’t even make enough to pay my bills and I have to pay for private insurance. I am counting every penny.”

A small step

At its most basic level, Oregon’s minimum wage is meant to help workers already struggling on the lowest end of the pay scale, Gardner said. It’s a small change, but one that is necessary to improve workers’ lives, he added.

”We’re seeing a broadening gap between the rich and poor and a narrowing band of middle-class workers,” Gardner said. ”Oregon believes people shouldn’t live on starvation wages.”

The minimum wage is a mixed bag for Central Oregon’s small businesses, said Allan Flood, community advocate for the Bend Area Community Action Team. He counsels small-business owners on startups and operations.

”On the outside, the increased minimum wage is good news,” but if the goal of raising the minimum wage is to get closer to living wages, then Central Oregon policy-makers need to decide if implementing a living wage is an appropriate, economically viable way to achieve that, Flood said.

A rising tide does not, metaphorically, float all boats, he added.

”As the economy rises, it needs to float all boats,” Flood said. ”I’m not sure (raising) the minimum wage is the best way to float all boats.”